Streaming service trumpets creation of better playlists

Saturday

Jan 18, 2014 at 12:01 AMJan 18, 2014 at 12:28 PM

SANTA MONICA, Calif. - Jimmy Iovine - whose career as a recording engineer, producer and music executive spans from John Lennon to Lady Gaga - was proudly showing off some of his hits one afternoon last month at a recording studio.

SANTA MONICA, Calif. — Jimmy Iovine — whose career as a recording engineer, producer and music executive spans from John Lennon to Lady Gaga — was proudly showing off some of his hits one afternoon last month at a recording studio.

He passed through rooms where Eminem and Gwen Stefani made records and pointed to the console on which Dr. Dre recorded his landmark 1992 album, The Chronic.

The studio walls were crammed with pictures of Steve Jobs, Bono and other celebrities sampling the bass-heavy Beats by Dr. Dre headphones, which — at prices as high as $450 — have become a billion-dollar success story.

Yet he is most excited to talk about his next project, Beats Music, a subscription streaming service he founded with Dr. Dre that will challenge Spotify, Pandora and Apple’s new iTunes Radio in the battle over how people consume music online.

With Trent Reznor of Nine Inch Nails as the service’s chief creative officer, Iovine is betting that Beats Music can solve a problem that most music fans might not realize they have: deciding what to listen to.

“What song comes next,” he said, “is as important as what song is playing now.”

Beats Music, to be available on Tuesday in the United States, is also making the latest salvation pitch for the struggling music industry. Streaming has taken center stage as the most promising new source of revenue.

Yet the more lucrative paid services have been slow to catch on, and the low royalty rates paid by these services have stirred resentment among musicians.

On its surface, Beats Music — which has $60 million in investment behind it and is an affiliate of Beats Electronics, the headphone company — is not radically different from Spotify, Rhapsody or any of the dozens of other music applications already available.

For $10 a month, Beats offers access to practically all the recorded music under the sun, with playlists galore to keep its customers tuned in.

Instead of being a mere utility for music, though, Beats comes across as more a digital playground, or maybe a nightclub. Its interface is built primarily for mobile use.

The idea is that bold visual appeal and the expertise of programmers (or “curators,” in company buzz-speak), in serving just the right song or playlist, will create excitement among the millions of listeners who have been unseduced — or just confused — by streaming music.

Beats will use algorithms, too, as part of how it customizes the songs it sends users based on their profiles and listening habits.

The difference, Beats executives say, is that their service makes greater use of its editors and guest programmers such as Rolling Stone, Rap Radar and Pitchfork; and recommends only the good stuff.

Unlike Spotify and some other services, Beats will have no free tier; it will be available only through paid subscription, which generally means higher royalty rates. (The company declined to specify its rates but said it pays all labels equally.)

“My phone knows where I’m at, what I’m up to, what temperature it is,” Reznor said. “It might even start to recognize locations I visit, patterns of motion. What if music could be collected in little parcels and served up to me effortlessly?”

AT&T will offer Beats Music subscriptions with monthly smartphone service and promote the bundle heavily.

In addition to the $10 individual plan, AT&T will sell a family plan for $15, giving separate Beats accounts to up to five users — a deal that puts Beats far ahead of its competitors.

“We’re going to show people .?.?. how to use this service, how to be entertained by it and how to be fulfilled by it,” Iovine

said.

In the converging world of digital music apps, everybody competes against everybody, and the success of Beats Music will depend as much on luring customers away from competitors as it will on the abundance of free music on the Internet.